4 Types of EAC formulas, when to use what

I see there are 4 types of EAC forecast calculation formulas available, but confused when to use each type.


EAC =  BAC / CPI


EAC = ETC + AC


EAC = (BAC-EV) + AC


EAC = [BAC-EV / spi * cpi] + AC


Please need a brief justification / explanation.


Thank you all for the helpful info.


 


 

Hi pmp3456

EAC =  BAC / CPI,  assume project costs are going to continuo in the same rate

EAC = ETC + AC, initial estimates are flawed

EAC = (BAC-EV) + AC, there was one big issue impacting cost, but for the rest of the project typical behaviour is expected.

 

Last one, have no idea

Per Rita's book,

EAC = AC + Bottom up ETC --  Used when original estimate is fundamentally flawed

EAC = BAC / Cumulative CPI  - Used if no variances have occured and same rate of spending will continue

EAC = AC + (BAC- EV)              - Used when variances are atypical /irregular

EAC = AC + ( BAC-EV / Cumulative CPI * Cumulative SPI) - Used when variances are typical(regular). Assumes poor cost performance. Hope this helps. 

 

 

Thanks Javerose, But when do you use the following any ideas?


EAC = [BAC-EV/spi*cpi] + AC

it is used when project schedule is factor impacting ETC effort. i.e. there is negative performance to date and project schedule dates must be met.


 


 

The explanation for the EAC formulae is excellently given by Harwinder in his blog


www.deeprfriedbrain.com


It should be easy to the apply the related formula when you go through them once.


Regards,


Kiran

 it seems, the link is incorrect, pls provide the correct link.

thanks

 

You should read the following article. It provides complete explanation of EAC formulas along with an example.

Estimate At Completion – 5 EAC Formulas for PMP Exam